Three Steps to Improved Negotiation and Sales Success
What happens when a salesperson isn’t an effective negotiator? Often, they simply write a proposal.
I’ve observed it happen many times. Somehow the salesperson thinks that if they put the information in writing the prospect will buy.
The truth is that a proposal should really be a confirmation of what has already been agreed to, or has been determined that the prospect wants, needs, and is interested in buying. These factors must first be understood before creating a proposal.
So how can a salesperson become an effective negotiator and understand these factors? Well, an effective negotiator is really just a skilled communicator. A salesperson must be prepared to thoroughly communicate and discuss the potential disagreeable components of the sale with a client or prospect before committing it all to writing.
Of course, this means discussing money, the motherload of discomfort creation for a majority of salespeople. How hard is it to discuss money? Fully 60% of salespeople are not comfortable doing it. Kind of weird for people who are supposed to extract money from others for goods and services.
If we delve into this problem further, we understand that it isn’t necessarily the individual seller’s fault. It is likely either the way they were raised or is based in their past beliefs about money.
Let me tell you what I mean. Many families believe that it is impolite to discuss money. As parents, details about earning and other money matters aren’t shared with the children. This implants the belief in them that money is not something to be talked about. So then when the grown-up salesperson is told to discuss money and budgets, it causes a conflict.
Additionally, some people from families with limited financial resources may be impacted by that as well and bring a mentality of scarcity to their work life. They therefore may have difficulty discussing with the price tag associated with higher-priced items and may struggle getting paid for the value that is truly delivered.
Three Things to Do:
- 1. The true value to the client must be understood by salespeople. It isn’t just about the price the client pays. It’s about the results, the outcome, the avoidance of something, or the removal of a bad situation. It is incumbent upon the manager to help salespeople REALLY understand the true value provided.
- If possible, create an ROI calculator that will help salespeople articulate and demonstrate the complete value of services to prospects. We sometimes use the following Sales hiring mistake calculator with our clients to demonstrate the impact we can have from a hiring perspective.
- It helps to conduct a team workshop session to articulate the value proposition, not from a marketing tagline perspective, but to really help salespeople internalize the value they and the company provides, and to help them develop conversation they can use to have a deeper discussion with clients and prospects. You may be interested in this Value Proposition Creation Toolkit for sales teams to help.
- 2. A repeatable process where money is discussed early in the process must be followed. Right after determining why the client is interested in talking, buying your services, or switching from their current provider, and how compelling the reason is, salespeople should be conditioned to discuss the financial impact of the client’s potential decision.
- Ideally, they should discuss it from the negative side of the equation. Salespeople need to learn and be able to discuss the cost of failure from the client’s perspective. This will have the biggest impact on salespeople gaining comfort in discussing money and will also work magic to help them close more business.
- 3. Providing proposals before the opportunity is fully qualified must be discontinued. This process needs to include gates that as the opportunity moves forward, require the salesperson to answer specific questions in order to pass through. Not until all the key questions are answered, which indicate a higher likelihood of closing the opportunity, should a salesperson be permitted to produce a proposal.
- The best way of controlling this is through a well-crafted CRM. The only system I know of that comes out of the box designed to enable salespeople to progress through a process in this way is Membrain. Learn more about it here.
Help your team close more business, more quickly, at higher profits, by first addressing the likelihood that sellers on your team have apprehension about money discussions. Follow the three-step process outlined and watch the team’s confidence grow.
Data courtesy of Objective Management Group derived from 617,407 salespeople.